Mexico's stock exchange on Monday suffered its largest single-day crash since 2008 as the peso dropped to its lowest exchange rate compared to the US dollar in three years.

The falls come amidst global fears over the new coronavirus and plummeting oil prices.

The stock exchange plunged 6.42 percent to close at 38,730.56 points.

The peso depreciated by 4.83 percent at close compared to Friday, dropping to 21.17 according to the central bank.

The fall of Mexico's stock market and the value of its currency comes amidst global fears over the new coronavirus and plummeting oil prices
The fall of Mexico's stock market and the value of its currency comes amidst global fears over the new coronavirus and plummeting oil prices AFP / Ulises Ruiz

The collapse of oil prices hurt the expectations of investors in regard to the state oil company PEMEX, which is already suffering the effects of a burdensome $105 billion debt.

The company needs an investment boost to reverse a trend in reduced production, currently at 1.6 million barrels a day, down from 3.4 million barrels a day in 2004.

"For Mexico, which is still not a net oil exporter, this implies a greater probability that PEMEX's credit rating will be downgraded," said Gabriela Siller, an economist at the local BASE bank in a report to clients.

In mid-2019, ratings agency Fitch downgraded PEMEX's shares into a speculative category due to their high risk.

Last month, PEMEX reported losses of more than $18 million for 2019, a 92 percent increase on its 2018 deficit.

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